Moody's eyes LMBE-MC for upgrade

Moody's Investors Service said it placed LMBE-MC Holdco II, LLC's senior secured credit facilities rated B1 under review for possible upgrade. LMBE-MC is indirectly owned by Talen Energy Supply LLC.

The review is driven by Talen’s plan to emerge from bankruptcy next month and the associated improvement in Talen's credit quality post-emergence, Moody’s said. Talen sought bankruptcy protection in May and is expected to emerge in mid-May 2023 with a newly restructured capital structure. The outlook has changed to Rating Under Review from negative.

“The review for possible upgrade will consider LMBE-MC Holdco's strategy as part of a more streamlined Talen corporate family, including whether existing ring-fencing provisions will prospectively remain in place and the manner in which the project plans to address its expiring $25 million senior secured credit facility. The review will also examine the issuer's hedging strategy along with its ability to maintain strong financial metrics and continued debt repayment in light of lower regional capacity and commodity price levels,” Moody’s said in a press release.

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